The Ministry of Industries and Production is reportedly battling to get control over the urea import plan in an effort to allocate the fertiliser''s distribution contract to its subsidiary, National Fertiliser Marketing Limited (NFML), official documents and informed sources told Business Recorder on Monday.
"The main objective of the revised proposal is to pocket money by using the network of NFC/NFML," commented one of the officials of the Industries Ministry on condition of anonymity. The Economic Co-ordination Committee (ECC) of the Cabinet, scheduled to meet on Tuesday with Petroleum Minister Syed Naveed Qamar in the chair, has been asked to review its earlier decision of September 15, and allow the Trading Corporation of Pakistan (TCP) to import 0.6 million tonnes of urea.
The ECC, in its meeting, on September 15, allowed the import of 400,000 tonnes of urea through private sector on a summary of Ministry of Food and Agriculture (Minfa), with a subsidy of Rs 750 per 50-kilogram bag to private importers of urea on first come first serve basis. A sum of around rupees five billion will, therefore, be required for the subsidy subject to the condition that the urea shipments arrive in the country by October 31 for the 2009-10 Rabi season.
Industries Minister Manzoor Wattoo had allegedly used his influence over Secretary General to the President Salman Farooqi to get control of transportation of the imported urea for Kharif, which backfired after the Commerce Ministry refused to accept the plan. Official documents available with Business Recorder revealed that earlier a meeting was held on September 10 under the chairmanship of Manzoor Wattoo to review the fertiliser situation for the Rabi season.
The representative of the provincial governments, NFC and manufacturers felt that 0.6 to 0.7 million tonnes of urea would be required to be imported because of the increasing trend of intensive urea consumption as well as due to extra application of urea in BT cotton crop.
According to the documents, it was pointed out in the meeting that since this was the last season in which urea fertiliser is required to be imported, it was not viable for the private sector to import and distribute it effectively all over the country for just one season as from the coming season, Pakistan will be surplus in urea.
The fertiliser industry proposed that the TCP should import and the NFML should distribute, using its dealers'' network already functional for the Kharif season. The Industries Ministry has also claimed that consensus on import of 0.6 million tonnes was reached keeping the domestic stock position in view. It was decided to take the final decision in a meeting with all the stakeholders.
Consequently, on September 16, another meeting was held under the chairmanship of the Minister for Industries, which was attended by the Ministers for Finance, Minfa, agriculture ministers of Punjab, Sindh along with senior officers from the Federal and provincial governments.
The Industries Ministry also claimed that the consensus of the meeting was that the TCP might be allowed to import six million tonnes of urea for the 2009-10 Rabi season for distribution through the NFML. The meeting reiterated that the Finance Ministry would facilitate the TCP to open letters of credit (LCs) in time and ensure that the urea shipments arrive in the country by October 31. It is important to note that November and December are very critical for the Rabi crop, as the urea demand is almost double as compared to the local supply.
Official documents disclosed that the Industries Ministry approached the Chairman of the ECC to review the earlier decision, taken in the ECC meeting of September 15 regarding import of 0.4 million tonnes of urea through the private sector and instead the TCP might be directed to import six million tonnes of urea for the Rabi on fast track basis for distribution through the NFML.
The sources said the Industries Ministry had submitted a summary to Prime Minister Syed Yousuf Raza Gilani to undo the decision of the ECC taken on September 16, but he refused to approve the proposal, directing the Ministry to go back to the ECC for review of its earlier decision.